This is an intermediate down trend.

Today saw the Nifty rally by almost a 100 points. My submission is:

We have seen a breakdown from a trading range. Do not underestimate the power of trading range breaks. The target for this down move is 2450. While the target may or may not be met, the chances are that the down move may take the Nifty lower than 2450.

The entry rules are the starting point for a trading strategy. The strategy requires rules for catastrophic exits, trailing stops, profit targets, filters for trading or not trading.

What are ‘filters for trading or not trading’ ? If you are using a momentum driven entry system (like the RSI2, I explained in my previous post) then you have to avoid taking signals when there is a strong trend. (How do you define a strong trend ?). When you think about your trading strategies, you will realize that your primary effort should be towards planning your trades in totality